CEO believes better proposals for 400-megawatt project will come.

Updated 2:41 am, Wednesday, November 2, 2011

CPS Energy CEO Doyle Beneby recommended trustees scrap all proposals for the power plant and start the process over.

CPS Energy CEO Doyle Beneby recommended trustees scrap all proposals for the power plant and start the process over.

Photo: EDWARD A. ORNELAS, SAN ANTONIO EXPRESS-NEWS

CPS starting over on bids for solar power

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After months of delay, CPS Energy is throwing out all the proposals from companies to build 400 megawatts of solar power here and will begin the process anew because the utility thinks there's a better deal out there.

Twelve finalists had been whittled down to two to build what could be one of the largest solar projects in the world, with CPS buying all the power from it. Many expected that a winner would be announced soon.

But on Monday, CEO Doyle Beneby recommended to the utility's trustees that they scrap the proposals altogether without making a selection.

After CPS had narrowed the field, it kept getting attractive offers from companies, in part because of rapidly falling prices for solar development. But CPS couldn't consider those later proposals because they came in after the deadline.

“I am committed to getting the best deal for San Antonio,” Beneby said after the meeting, “and I'm not going to leave any good proposal on the table.”

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He acknowledged that the original request for proposals was written too loosely, making it difficult to accurately compare the deals being offered, which must include an economic development component as well as energy. Beneby said he was willing to take a public relations hit if it meant ratepayers come out ahead.

CPS made international headlines in July when it increased the solar project from 50 megawatts to 400 megawatts — enough to power 80,000 homes. The utility fielded more than 100 proposals from companies across the globe.

CPS' new request will be written with tighter requirements and will be open to all. The board unanimously supported the move, Beneby said.

New specifics could include the number of jobs a company is required to bring to town or the type of manufacturing technology a company must locate here.

Beneby said CPS would use consultants to help “galvanize the lessons learned and start on new wording tonight.”

He said he didn't know of any other utility looking to buy the output from 400 megawatts of solar power, to be built over five years and requiring economic development with it.

Perhaps because of that, the process has been a rocky one.

In January, Beneby announced that CPS would invest in what he called “big solar.” Notably, as part of the deal, whichever company was chosen would also have to locate some part of its business in San Antonio and bring jobs.

In March, CPS hosted more than 50 solar and related companies in San Antonio to answer questions about the original request. The utility managed to anger many by announcing that the May deadline would be moved up by two weeks, a decision CPS ultimately reversed.

That deadline came and went.

In June, Beneby told the San Antonio Express-News Editorial Board that the utility had narrowed the field to two finalists. But when two late proposals came in, Beneby said they were too attractive to pass up.

In July, CPS again surprised the solar community when it extended the deadline two weeks, allowing companies to expand proposals from 50 megawatts up to 400.

Grumbling at the time was muted, since it gave everyone a chance to resubmit for what will still be one of the largest solar deals in the country.

Restarting the entire process, said spokeswoman Lisa Lewis, “gives everyone (who has already participated) a third bite at the apple.”

Lanny Sinkin, executive director of Solar San Antonio, a nonprofit that encourages solar energy, called the move a bold one and said he applauded CPS “for being frank and for trying to do the right thing.”

He said that while restarting the process would inevitably lead to some kvetching, companies have also had plenty of time to think about what they would have done differently.

“CPS has an ethical obligation to get the best deal possible,” he said.